Saudi Aramco today welcomed the introduction of the new tax regime for all hydrocarbon producers operating in the kingdom as another positive step in the diversification of the kingdom’s economy.

 

Amin H Nasser, president and CEO, Saudi Aramco, said the company welcomed King Salman's Royal Order announcing the reduction of Saudi Aramco's tax rate to 50 percent from 85 percent. 

 

The new tax rate will bring Saudi Aramco in line with international benchmarks, he said.

 

Nasser reiterated that Saudi Aramco would continue to make a critical contribution to the diversification and growth of the Saudi economy in line with Saudi Vision 2030.

 

The new tax rate comes in the wake of plans for the sale of a 5 per cent stake in the state-controlled company in 2018. The IPO is likely the largest of its kind in the world, with a potential value of $100 billion.

 

Earlier, the official Saudi Press Agency reported that the kingdom has set a range of income tax rates for producers of oil and hydrocarbons.

The tax rate for investments exceeding SR375 billion ($100 billion) will be 50 percent, SPA was quoted as saying by Reuters. It gave other rates for producers with smaller investments.

Aramco currently pays a 20 percent royalty and 85 percent tax to the government, Saudi officials have said. - TradeArabia News Service